<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/05/5R7VEUJWQ5PBPF3GBAJZSWUISI-820x547.jpg" alt="" class="wp-image-425186" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/05/5R7VEUJWQ5PBPF3GBAJZSWUISI-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/5R7VEUJWQ5PBPF3GBAJZSWUISI-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/5R7VEUJWQ5PBPF3GBAJZSWUISI-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/5R7VEUJWQ5PBPF3GBAJZSWUISI-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/5R7VEUJWQ5PBPF3GBAJZSWUISI-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/5R7VEUJWQ5PBPF3GBAJZSWUISI-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Nigeria&#8217;s President Bola Tinubu looks on, as he takes the traditional ride on top of a ceremonial vehicle, after his swearing-in ceremony in Abuja, Nigeria May 29, 2023. REUTERS/Temilade Adelaja</figcaption></figure>



ABUJA, May 31 (Reuters)&nbsp;&#8211;&nbsp;Nigeria&#8217;s state oil firm NNPC Ltd is proposing hiking petrol prices to as high as 557 naira ($1.21) per litre from 189 naira, according to a circular it sent to fuel stations, seen by Reuters on Wednesday.



The increase will signal an end to a fuel subsidy regime that the NNPC says costs it $867 million a month and which new President Bola Tinubu said on Monday would be scrapped.



Facing economic hardships, many Nigerians consider cheap petrol a right and the last time a government tried to remove the subsidy in 2012, it caused nationwide protests. Tinubu, then an opposition leader, opposed the removal of the subsidy.



The NNPC circular came after panic buying caused prices to jump as Nigerians rushed to fill their tanks ahead of the expected end of the subsidy that had been keeping prices low.



NNPC&#8217;s spokesperson declined to comment.



On Tuesday, the NNPC&#8217;s chief executive said the corporation was owed $6.1 billion in fuel subsidy payments by the federal government and that Nigeria could no longer afford to pay for the subsidies.



Fuel outlets owned by NNPC were already selling petrol for 448 naira a litre in some parts of Lagos, up from 185, while in Abuja it was being sold for 537 naira.



An increase in petrol prices would increase transport costs for workers and many small businesses that rely on generators, in a country where grid electricity supply is meagre.



Rating agency Moody said Tinubu&#8217;s pledge to remove the subsidy and unify Nigeria&#8217;s multiple exchange rates was &#8220;credit positive&#8221;. But it warned of risks in the initial period, including higher inflation, weaker economic activity and more social discontent.



($1 = 460.0000 naira)



(Reporting by MacDonald Dzirutwe, writing by Chijioke Ohuocha;Editing by Estelle Shirbon and Emelia Sithole-Matarise)

Nigeria’s President Bola Tinubu looks on as he takes the traditional ride on top of a ceremonial vehicle after his swearing-in ceremony in Abuja

Nigeria to triple petrol prices after president says subsidy to end

UBA: Bond market mixed despite elevated liquidity

<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="820" height="566" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/05/5S7UQ4RY7VMH7IOIILNTACUTRA-820x566.jpg" alt="" class="wp-image-425180" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/05/5S7UQ4RY7VMH7IOIILNTACUTRA-820x566.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/5S7UQ4RY7VMH7IOIILNTACUTRA-300x207.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/5S7UQ4RY7VMH7IOIILNTACUTRA-130x90.jpg 130w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/5S7UQ4RY7VMH7IOIILNTACUTRA-768x530.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/5S7UQ4RY7VMH7IOIILNTACUTRA-1536x1061.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/5S7UQ4RY7VMH7IOIILNTACUTRA-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: The buildings with the logos of three of South Africa&#8217;s biggest banks, ABSA, Standard Bank and First National Bank (FNB) are seen against the city skyline in Cape Town, South Africa, September 3, 2017. REUTERS/Mike Hutchings</figcaption></figure>



JOHANNESBURG, May 31 (Reuters)&nbsp;&#8211;&nbsp;Economic growth in key Sub-Saharan African economies will slow this year as weaker global growth makes the backdrop less favourable and high interest rates deter investment, ratings agency S&amp;P said in a research report.



S&amp;P said it now forecast the gross domestic product of eight Sub-Saharan African economies it tracks would expand 2.9% in 2023, down from 3.4% in 2022.



Its latest forecast is slightly more gloomy than a research report from June last year that predicted 2023 growth of 3.2% for seven African economies.



This year&#8217;s report included economic forecasts for Angola, Democratic Republic of Congo, Ethiopia, Ghana, Kenya, Mozambique, Nigeria and South Africa. S&amp;P&#8217;s 2022 report did not feature Mozambique forecasts.



&#8220;The economic environment remains far from growth friendly, reflecting elevated policy uncertainty and above-average systemic financial stress,&#8221; S&amp;P said. &#8220;Policymakers face a tricky trade-off between public debt management, especially given higher interest rates, and macroeconomic stability.&#8221;



However, the end of the COVID-19 pandemic, the reopening of tourism and services sectors, and falling food and fuel prices should bring some relief, S&amp;P added.



S&amp;P now forecasts South Africa&#8217;s economy will grow 0.7% this year, down from a 1.6% forecast given in June 2022 because of an intensifying electricity crisis.



Democratic Republic of Congo and Ethiopia were poised to be the growth leaders in 2023 with GDP expansions of 6% this year, supported by mining in Congo and a recovery in investment in Ethiopia after a ceasefire between the government and Tigray forces, S&amp;P said.



Looking to 2024, S&amp;P projected average growth of 3.4% in the eight countries.



(Reporting by Anait Miridzhanian; Editing by Alexander Winning and Alison Williams)

The buildings with the logos of three of South Africa’s biggest banks, ABSA, Standard Bank and First National Bank (FNB) are seen against the city skyline in Cape Town

S&P sees weaker 2023 growth in key African economies as tailwinds fade

Nigeria Eurobonds & stocks rally on new policy direction

African Agriculture, Inc. (AAGR) is a US-based for-profit entity addressing the expanding regional and global challenges of food security and the resilience of food and food supply chain systems.



AAGR is primarily a producer of necessary staples for cattle feed, primarily alfalfa, looking to expand existing production for local, regional, and export consumption from its current operations in West Africa. A critical component of livestock feed, and therefore food security, alfalfa hay currently commands record high prices.



Impacted by the Covid-19 pandemic, the Russian-Ukraine war and the severe drought since 2021 in the Western US, one of the largest alfalfa production areas in the world, the global market is poised to grow significantly. The company seeks to expand plant-based protein source production, through collaboration with local farming collectives, providing nutrition for local and regional consumption, and simultaneously driving export-based revenue and corporate profitability.



The company is confident it addresses numerous United Nations Sustainable Development Goals in its approach (albeit accidentally), as it diversifies its production offering, and exposure to climates and regions across the African continent.



“We recognized that we had a very unique geographical location to produce alfalfa,” says Chairman and CEO, Alan Kessler. “Not only is the Sahara sun a perfect operational partner–the old adage to make hay while the sun shines–but the abundance of cattle in the Sahel, quoted as over 200 million heads of cattle provides a massive market opportunity both locally and regionally for our product.”



“Local dairy and beef production is evolving as a consequence of the scaled production of our product, developing local food access, and minimizing the economic waste of imports and foreign exchange utilization. As the company looked beyond alfalfa, the key was to look for reasons for yield discrepancies in agricultural production in say, Western Europe, and that of the African continent,” he adds.



“Consistent power, farming management, machinery and capital access, logistics, agronomy, soil understanding need to be addressed. I am very proud of the experienced management team and board of directors all of whom have substantial operational experience on the African continent. We are all aligned and driven to achieve our vision.”



After considerable investment in infrastructure and feasibility studies, AAGR began its commercial alfalfa operations early in 2022 and is already seeing considerable success in transforming desert-like arid conditions to ideal growing conditions for alfalfa. AAGR is already achieving worldclass yields and quality, and is working to expand its capital base to increase its production capability.



In 2021, AAGR signed an agreement with Louisiana State University’s Agcenter to bolster education and training in Senegal. Additionally, AAGR recently signed a letter of intent with the College of Agriculture and Natural Resources at Michigan State University (MSU), to further develop the fields of soil science, agronomy, cattle nutrition, emissions, and animal genetics in Mauritania, an area of development for AAGR.



“The opportunity to work with US tertiary institutions with vast agricultural knowledge is a great pathway for skills transfer and development,” says Kessler. The company aspires to be positioned at the nexus of precision agriculture, yield optimization, and climate-smart approaches, on a continent that possesses the optimal growth conditions to address global food security challenges.



“African assets have historically been ascribed an Africa discount by global investors, given lack of liquidity in local capital markets, lack of strategic exit options, and historically challenged governance structures. Given Africa’s superior sun exposure, water purity, scalable land, extended and consistent



growing seasons that mitigate supply chain disruptions, a young and motivated local population, with a legacy in agriculture, and growing improving logistical capabilities, African agricultural opportunities should command an investment premium,” Kessler concludes.



In terms of impact, AAGR is dedicated to its local communities by partnership, creating employment and providing sustainable development. Like its icon the Baobab tree, the group believes in the ecosystem and the community which it fosters. In Senegal, this is apparent in their local land program which allocate 2000 hectares to the population of the villages of the Ndiael Reserve (Inter-Villagers Association living inside) each year. These lands are divided equally between the company’s two main local Communes of Ronkh and Ngnith. In addition, AAGR grants village organizations the distribution of alfalfa for their livestock feed. Moreover, they have implemented a maternal health program, “Shuttle for Sonograms” Before this shuttle, pregnant woman had to walk 52 kilometers on degraded roads to get Sonograms. The group now takes them in company shuttle buses to get necessary care. AAGR is currently working to repair schools, donate computers, reopen health facilities, and construct the Great Mosque of the Commune of Ngnith which covers 74 villages. They have started a dental program, working with a high school student group from the United States to boost dental awareness and provided the basics of dental health for 15,000 people. Officially they work for sports and community cohesion, via the local sports teams. AAGR defines their success in the growth of local communities. The private sector investment is anticipated to contribute to employment and economic development directly, and will include a Corporate Social Responsibility (CSR) program that will enhance the agricultural and agronomy tertiary education at ENFVA (Ecole Nationale de Formation et de Vulgarisation Agricole), an established agricultural education center in the city of Kaédi, and a women&#8217;s reinsertion program in Mauritania. <a href="http://www.africanagriculture.com">www.africanagriculture.com</a>

AA-1

Making Hay Under The African Sun

<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="820" height="523" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/05/south-africa-russia-e1685444414271-820x523.jpg" alt="" class="wp-image-425171" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/05/south-africa-russia-e1685444414271-820x523.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/south-africa-russia-e1685444414271-300x192.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/south-africa-russia-e1685444414271-141x90.jpg 141w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/south-africa-russia-e1685444414271-768x490.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/south-africa-russia-e1685444414271.jpg 860w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">President Cyril Ramaphosa of South Africa meets President Vladimir Putin of Russia at the Russia-Africa Summit in Sochi in 2019. Credit: GovernmentZA.</figcaption></figure>



Stagnation at home and fence-sitting abroad are costing the country dearly, and the costs are only rising.



<a href="https://africanarguments.org/category/african-arguments/country/southern/south-africa/">South Africa</a> is facing two fundamental challenges, one internal, the other external. Its response to both – or failure to respond to either – will define its future prosperity and position in the world. A policy of indecisive drift will not resolve either.



Internally, the government must tackle the incompetence and graft that have undermined the delivery of vital services – above all, energy and transport – and that are doing serious damage to the prospects for economic growth.



Externally, South Africa’s efforts to sit on the fence between East and West – as it sees them – is being made increasingly uncomfortable by the war in Ukraine. Economically, its fortunes lie overwhelmingly with the liberal world economy. Politically, the old alliances with Russia and China still carry weight. The recent row with the US, threatening trade, and the invitation to&nbsp; President Vladimir Putin for the BRICS Summit suggest a crunch is coming.



It is the internal challenges that preoccupy most South Africans most of the time. “Load-shedding”, the euphemism for power cuts, is getting heavier, more costly, and more disruptive. As South Africa heads into winter, there is even talk of a potentially catastrophic grid loss. The government has resorted to hiring Karpower generator ships (at great expense), and the private sector is increasingly taking its own steps to reinforce generation capacity, including through growing investment in renewable power generation. Sales of solar panels are reportedly going through the roof. But they would rather have a grid that worked.



Former CEO André de Ruyter’s&nbsp;<a href="https://businesstech.co.za/news/energy/687775/de-ruyter-goes-for-round-2-on-eskom-corruption-in-explosive-tell-all-book/">exposé</a>&nbsp;of the incompetence and corruption at state energy supplier ESKOM has made it harder for the government to shuffle off responsibility for the woeful collapse in generation. State capture may have been exposed and contained, but it is still far from being rolled back. So hopeless has the government been that&nbsp;<a href="https://www.afrobarometer.org/articles/majority-of-south-africans-say-eskom-should-be-privatised-new-afrobarometer-study-shows/">Afrobarometer</a>&nbsp;reports nearly 60% of South Africans would prefer ESKOM to be privatised as the only way to get a reliable power supply.



This crisis illustrates that the ruling African National Congress (ANC) has become less a coalition of constituencies and more a patchwork of self-interested cliques who are reaping benefits from the state and passing them on exclusively to their loyal clients. Rent-seeking rather than service delivery has become the order of the day, and a reason to hang on to power. Buying off those cliques to keep himself in the presidency seems to be all Cyril Ramaphosa can manage. The ANC has rusted in power: the façade of the state remains, but behind it is decay that will bring the façade down if left unaddressed.



The last serious plan to reform the economy was Trevor Manuel’s&nbsp;<a href="https://www.gov.za/issues/national-development-plan-2030">National Development Plan</a>, launched in 2012. More than half-way to its 2030 target, little has been achieved. Of course, Covid and the Ukraine war interrupted all plans; but they have equally underlined the urgency of reform. South Africa ought to be bouncing back, with mineral prices high, surplus labour and – at least once upon a time – the best infrastructure in Africa. Instead, it is bumping along the bottom.



There is plenty of entrepreneurial and economic potential in the country. In the recent Financial Times survey of the&nbsp;<a href="https://www.ft.com/reports/africas-fastest-growing-companies">Fastest Growing Companies in Africa</a>, one third of the top 100 companies were based in South Africa, in sectors as diverse as fintech, IT, healthcare, energy, education, and agriculture as well as mining. But many of these companies lack access to the right kind of funding and feel that government is more an obstacle than a support to their efforts. Yet it is still the private sector that is going to create the jobs needed to employ the 50-70% of young people currently unemployed.



The lack of international investment and governmental reform will cost the economy dear in a few years’ time. Sweating assets will keep production up for a while, but a future decline in output is unavoidable unless investment increases now.



And that is where the second challenge becomes relevant domestically as well as globally.



Since 1994, the ANC has tried to balance South Africa’s economic engagement with Western markets – in 2022, 36% of its&nbsp;<a href="https://www.sars.gov.za/customs-and-excise/trade-statistics/">exports</a>&nbsp;went to the EU, US and UK, against 25% to Africa and 10% to China – with a political commitment to non-alignment and close party contacts with Russia, China, and liberation movements across the world. The Ukraine war and now the BRICS Summit in August are testing that balance.



Though initially quick to condemn the invasion, the South African government subsequently rowed back. And, in March this year, President Ramaphosa blamed&nbsp;<a href="https://www.aljazeera.com/news/2022/3/18/update-1-s-africas-ramaphosa-blames-nato-for-russias-war-in-ukraine">NATO expansion</a>&nbsp;for the outbreak of hostilities, echoing Russia’s own justification for the war. That, together with the alleged loading of weapons onto a Russian vessel in South Africa last December, provoked a rare public criticism from&nbsp;<a href="https://www.reuters.com/world/us-unlikely-sanction-south-africa-russia-weapons-dispute-bloomberg-news-2023-05-14/">US Ambassador Reuben Brigety</a>. Though the row has been defused, the implication that South Africa’s privileged access to US markets under the AGOA trade deal (worth&nbsp;<a href="https://www.tralac.org/blog/article/15522-update-on-the-african-growth-and-opportunity-act-agoa-and-related-developments.html#:~:text=South%20Africa%20continues%20to%20be,the%20most%20diversified%20export%20range.">$2.7 billion in 2021</a>) might not survive Congressional scrutiny when renewed in 2024, has been firmly registered. No Russian, Chinese, or African markets could compensate for that.



Putin’s indictment by the International Criminal Court (ICC) for child abduction poses a particular challenge for South Africa as host of the 2023 BRICS Summit. ICC indictments of incumbent heads of state are particularly problematic. In the case of both Presidents Uhuru Kenyatta of Kenya and Omar al-Bashir of Sudan, the indictments drew attention to their crimes but also inhibited diplomatic efforts to address the underlying problems. This made it difficult for others to discuss with and pressure them.



South Africa, which still belongs to the ICC, has been here before. When al-Bashir attended the African Union Summit in Durban in 2015, civil society groups took the government to court to arrest him while he was in the country, as required for ICC members. The&nbsp;<a href="https://www.theguardian.com/world/2016/mar/16/south-african-court-rules-failure-to-detain-omar-al-bashir-was-disgraceful">courts supported the case</a>&nbsp;and the government had to swiftly and surreptitiously smuggle al-Bashir out of the country, embarrassing everyone. If Putin shows up in August, this will happen again. Some in the ANC have urged the government to withdraw from the ICC as an interfering “Western” institution (though most African states are members), but this cannot be done before August.



Sitting on the global fence is becoming increasingly uncomfortable for South Africa. It will not dismount, but the pain is now economic as well as political, and the cost is rising.



Overall, the ANC appears to have become so introspective that it is losing touch with both its own citizens and the outside world. With a fragmented opposition, its chances of retaining power in next year’s elections, even if forced into a coalition, are strong. But as one observer told me, the only political party that was growing fast was the Apathy Party – and that itself poses problems for the country as a whole. To save its skin, the ANC needs to reform itself and the country, and fast.

south-africa-russia-e1685444414271

The two defining challenges facing South Africa

<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/05/Top-AI-CEOs-experts-raise-risk-of-extinction-from-AI-Reuters-820x547.jpg" alt="" class="wp-image-425166" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/05/Top-AI-CEOs-experts-raise-risk-of-extinction-from-AI-Reuters-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/Top-AI-CEOs-experts-raise-risk-of-extinction-from-AI-Reuters-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/Top-AI-CEOs-experts-raise-risk-of-extinction-from-AI-Reuters-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/Top-AI-CEOs-experts-raise-risk-of-extinction-from-AI-Reuters-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/Top-AI-CEOs-experts-raise-risk-of-extinction-from-AI-Reuters-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/Top-AI-CEOs-experts-raise-risk-of-extinction-from-AI-Reuters-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">The logo of OpenAI is displayed near a response by its AI chatbot ChatGPT on its website, in this illustration picture taken February 9, 2023. REUTERS/Florence Lo/Illustration/File Photo</figcaption></figure>



Artificial intelligence may lead to human extinction and reducing the risks associated with the technology should be a global priority, industry experts and tech leaders stated in an open letter.



“Mitigating the risk of extinction from AI should be a global priority alongside other societal-scale risks such as pandemics and nuclear war,” the statement on Tuesday read.



Sam Altman, CEO of ChatGPT-maker OpenAI, as well as executives from Google’s AI arm DeepMind and Microsoft were among those who supported and signed the short statement from the Center for AI Safety.



The technology has gathered pace in recent months after chatbot ChatGPT was released for public use in November and subsequently went viral. In just two months after its launch, it reached 100 million users. ChatGPT has amazed researchers and the general public with its ability to generate humanlike responses to users’ prompts, suggesting that AI could replace jobs and imitate humans.



The statement Tuesday said that there has been increasing discussion about a “broad spectrum of important and urgent risks from AI.”



But it said it can be “difficult to voice concerns about some of advanced AI’s most severe risks” and had the aim of overcoming this obstacle and opening up the discussions.



ChatGPT has arguably sparked much more awareness and adoption of AI as major firms around the world have raced to develop rival products and capabilities.



Altman had admitted in March that he is a “little bit scared” of AI as he worries that authoritarian governments would develop the technology. Other tech leaders such as Tesla’s Elon Musk and former Google CEO Eric Schmidt have cautioned about the risks AI poses to society.



In an open letter in March, Musk, Apple co-founder Steve Wozniak and several tech leaders urged AI labs to stop training systems to be more powerful than GPT-4 — which is OpenAI’s latest large language model. They also called for a six-month pause on such advanced development.



“Contemporary AI systems are now becoming human-competitive at general tasks,” said the letter.



“Should we automate away all the jobs, including the fulfilling ones? Should we develop nonhuman minds that might eventually outnumber, outsmart, obsolete and replace us? Should we risk loss of control of our civilization?” the letter asked.



Last week, Schmidt also separately warned about the “existential risks” associated with AI as the technology advances.

Illustration picture of ChatGPT

A.I. poses human extinction risk on par with nuclear war, Sam Altman and other tech leaders warn

<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="820" height="536" src="https://cms.cnbcafrica.com/wp-content/uploads/2022/02/RLMIHL2X2BNFJHXI3AKPGZ4KQA-820x536.jpg" alt="" class="wp-image-415202" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2022/02/RLMIHL2X2BNFJHXI3AKPGZ4KQA-820x536.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2022/02/RLMIHL2X2BNFJHXI3AKPGZ4KQA-300x196.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2022/02/RLMIHL2X2BNFJHXI3AKPGZ4KQA-138x90.jpg 138w, https://cms.cnbcafrica.com/wp-content/uploads/2022/02/RLMIHL2X2BNFJHXI3AKPGZ4KQA-768x502.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2022/02/RLMIHL2X2BNFJHXI3AKPGZ4KQA-1536x1004.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2022/02/RLMIHL2X2BNFJHXI3AKPGZ4KQA-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: Kenya Central Bank Governor Patrick Njoroge in Nairobi, Kenya July 25, 2019. REUTERS/Stringer/File Photo</figcaption></figure>



NAIROBI, May 31 (Reuters)&nbsp;&#8211;&nbsp;Kenya&#8217;s central bank governor nominee Kamau Thugge plans to push for local dollar bond issuance with the finance ministry once in office, he said, citing residents&#8217; domestic holdings of foreign currency.



President William Ruto named Thugge, an economic adviser and former senior Treasury official, as the next governor of the central bank two weeks ago.



Once cleared by parliament, which is controlled by Ruto&#8217;s coalition, Thugge will replace Patrick Njoroge, who retires next month after two terms that have run since mid-2015.



On Tuesday Thugge told a parliamentary vetting panel that it was worth pursuing the issue of a local dollar-denominated bond, given foreign exchange deposits of about 1 trillion shillings ($7.33 billion) in the banking system.



&#8220;One of the things that I would like to explore with the national treasury is the possibility of actually issuing a dollar-denominated bond, the way we issue an infrastructure bond, and we structure it, and sell it locally,&#8221; he said.



&#8220;If we can get those Kenyans who are holding dollars in their deposits to buy into it &#8230; we will have a possibility of actually increasing liquidity of dollars in the system but also building up foreign exchange in the central bank.&#8221;



The central bank&#8217;s foreign exchange reserves of $6.49 billion cover 3.62 months of imports, which the bank says is sufficient to cushion any short-term shocks in the foreign exchange market.



Challenges awaiting Thugge in office include a rapid weakening of the Kenyan shilling&nbsp;KES=&nbsp;and a heavy government debt load that has crimped its finances.



($1=136.5000 Kenyan shillings)



(Reporting by George Obulutsa; Editing by Clarence Fernandez)

FILE PHOTO: Kenya Central Bank Governor Patrick Njoroge addresses a news conference at the Central Bank of Kenya headquarters in Nairobi

Kenya central bank nominee to push for local dollar bond issuance

<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2022/09/GettyImages-1240090144-820x547.jpg" alt="" class="wp-image-419915" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2022/09/GettyImages-1240090144-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2022/09/GettyImages-1240090144-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2022/09/GettyImages-1240090144-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2022/09/GettyImages-1240090144-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2022/09/GettyImages-1240090144-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2022/09/GettyImages-1240090144-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">The World Bank Group headquarters in Washington, D.C., U.S., on Tuesday, April 19, 2022. The International Monetary Fund (IMF) slashed its world growth forecast by the most since the early months of the Covid-19 pandemic, and projected even faster inflation, after Russia invaded Ukraine and China renewed virus lockdowns. Photographer: Al Drago/Bloomberg via Getty Images</figcaption></figure>



NAIROBI, May 30 (Reuters)&nbsp;&#8211;&nbsp;The World Bank said on Tuesday it approved a $1 billion loan to Kenya to support its budget as East Africa&#8217;s economic powerhouse confronts high debts and a weakening currency.



The lending will be done through an instrument called a Development Policy Operations (DPO) loan, which commits Kenya to instituting reforms aimed at creating fiscal space, improving agricultural competitiveness and improving governance.



&#8220;The government&#8217;s reforms, supported by the DPO, will help to achieve fiscal consolidation, which is essential for reducing the debt burden and related risks, in an equitable and sustainable manner,&#8221; Aghassi Mkrtchyan, Senior Economist for the World Bank in Kenya, said in a statement.



President William Ruto, who was elected last year, has pledged to restore fiscal discipline after public debt surged under his predecessor.



But his proposal to raise taxes on a wide swathe of economic activities as part of the finance bill his government will put forward in parliament next month has faced pushback from civil servants and political opponents.



Kenya qualified for financing under the DPO instrument in 2019 and has since received four such loans, the last in March.



Reforms that Kenya will adopt under the latest agreement include the elimination of administrative price-setting for publicly procured cereals and the streamlining of the state’s exit from commercial investments, the World Bank said.



Kenya’s finances have been under strain from rising debt repayments and the effects of the Horn of Africa&#8217;s worst drought in four decades.



Earlier this month, global ratings agency Moody&#8217;s cut Kenya&#8217;s senior unsecured debt rating as well as long-term foreign-currency and local-currency issuer ratings, citing an increase in government liquidity risks.



The economy is projected to expand by 5.8% in 2023, the country&#8217;s central bank said in March, up from 4.8% in 2022.



(Reporting by Ayenat Mersie; Editing by Aaron Ross and Giles Elgood)

IMF And World Bank Headquarters During Virtual Spring Meetings

World Bank approves $1 billion loan to Kenya

How To Fix The Water Crisis | CNBC Marathon

<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/05/5DSIOVXMUFLQ5NBH22D3TKPXYU-820x547.jpg" alt="" class="wp-image-425151" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/05/5DSIOVXMUFLQ5NBH22D3TKPXYU-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/5DSIOVXMUFLQ5NBH22D3TKPXYU-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/5DSIOVXMUFLQ5NBH22D3TKPXYU-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/5DSIOVXMUFLQ5NBH22D3TKPXYU-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/5DSIOVXMUFLQ5NBH22D3TKPXYU-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/5DSIOVXMUFLQ5NBH22D3TKPXYU-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: President of the Republic of Botswana, Mokgweetsi Eric Keabetswe Masisi, speaks prior to the official talks with the delegation members of Switzerland and Botswana, in Bern, Switzerland, May 1, 2023. Peter Klaunzer/Keystone/Pool via REUTERS/</figcaption></figure>



GABORONE, May 30 (Reuters) &#8211; Botswana wants to maintain its partnership with De Beers and is confident that ongoing negotiations for a new diamond sales agreement will succeed, a government spokesperson said on Tuesday.



Botswana is negotiating a new sales deal with Anglo American Plc&#8217;s AAL.L De Beers ahead of the expiry of its current agreement, signed in 2011, later this year.



President Mokgweetsi Masisi&#8217;s threats to walk away from the negotiations if Botswana fails to secure a bigger share of rough diamonds produced by Debswana, their 54-year-old diamond mining joint venture, have fueled speculation that the government may end the relationship.



But in a statement, government spokesperson William Sentshebeng said the negotiations between the government and De Beers &#8220;are ongoing, and we are confident that they will result in a deal that will benefit both parties&#8221;.



Botswana&#8217;s share of Debswana&#8217;s output increased to 25% in 2020 from 10% in 2011. Although Botswana has not publicly stated what share it is seeking in the new deal, it is believed to be as high as 50%.



Sentshebeng said talks to renew De Beers&#8217; diamond mining rights, which are due to expire in 2029, were also being held well in advance to allow for critical investment decisions.



De Beers and Botswana plan to invest in capital intensive expansion projects at their two largest mines, Jwaneng and Orapa, to extend their lifespans by another 20 years.



In March, Masisi&#8217;s announcement that Botswana will take up a 24% stake in Belgian gem cutter and trader HB Antwerp was seen as an attempt to reduce De Beers’ dominance over the country’s diamond industry.



But Sentshebeng said Botswana&#8217;s partnership with HB Antwerp was meant to secure a stake in diamond processing and value addition.



“The partnership with HB Antwerp will not affect or replace the partnership with De Beers, which is premised on mining and selling rough diamonds,” Sentshebeng said.



(Reporting by Brian Benza; Editing by Nelson Banya and Jan Harvey)

FILE PHOTO: Botswana’s President Masisi visits Switzerland

Botswana says it is still keen on De Beers partnership, confident of new deal

Nigerian equities sustain rally

<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="820" height="445" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/05/YH4D45N7D5N3HEI4GHUUFL5TGE-820x445.jpg" alt="" class="wp-image-425145" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/05/YH4D45N7D5N3HEI4GHUUFL5TGE-820x445.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/YH4D45N7D5N3HEI4GHUUFL5TGE-300x163.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/YH4D45N7D5N3HEI4GHUUFL5TGE-160x87.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/YH4D45N7D5N3HEI4GHUUFL5TGE-768x417.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/YH4D45N7D5N3HEI4GHUUFL5TGE-1536x834.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/YH4D45N7D5N3HEI4GHUUFL5TGE-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: The International Cricket Council (ICC) logo at the ICC headquarters in Dubai, October 31, 2010. REUTERS/Nikhil Monteiro/File Photo</figcaption></figure>



NEW DELHI, May 30 (Reuters)&nbsp;&#8211;&nbsp;Cricket&#8217;s cash-starved associate member nations fear the proposed new international revenue distribution model, which heavily favours the game&#8217;s superpowers, could potentially stall the growth of the game.



The International Cricket Council (ICC) has proposed a new revenue sharing model for the 2024-27 cycle to be voted on at its July board meeting in Durban.



According to figures leaked to Cricinfo, cricket&#8217;s financial engine India would alone claim 38.5%, primarily in recognition of its contribution to the commercial revenue pot.



The 12 full members of the ICC would collectively take 88.81% with the rest distributed among 94 associate members.



The ICC has not commented on the figures, though general manager Wasim Khan said on Monday all members would get more money under the proposed model than in the past.



Pakistan have already made clear their opposition to the model in its current shape and resentment is rumbling among other, less developed, cricketing nations.



Sumod Damodar, one of the three associate member representatives on the ICC Chief Executives&#8217; Committee, said the proposal would not meet the needs of associate members.



&#8220;If what is being proposed and discussed is likely to be the outcome then, as an associate member representative, I would be (disappointed),&#8221; he told Reuters.



&#8220;There are numerous practical reasons why it would be inadequate for associate members.&#8221;



Damodar, vice chairman of&nbsp;Botswana&#8217;s board, said associate members who have earned one-day international (ODI) status need more money to sustain their high-performance programmes, while the others need cash to bridge the gap.



Citing the rapid rise of Nepal in men&#8217;s cricket and Thailand in the women&#8217;s game, Damodar said more countries would step up if they were given the required financial support.



Vanuatu Cricket Association Chief Executive Tim Cutler said the proposed model would only accentuate the inequality between cricket&#8217;s haves and have-nots.



&#8220;The new model is now even more heavily weighted towards the bigger cricketing nations, and there is a risk that the proposed changes will exacerbate this imbalance, putting the future of the game at further risk,&#8221; Cutler told Reuters.



&#8220;The sad reality is, cricket will not grow beyond its current corners of the world &#8230; if the allocation of the game’s global funds aren&#8217;t more equally allocated with a view to actually growing the game.&#8221;



With full members having 12 of the 17 total votes on the ICC board, Cutler said diverting funds away from themselves, or making independent decisions for the good of the game, would be like &#8220;turkeys voting for Christmas&#8221;.



The ICC did not respond to a request for comment when asked about the concerns of the associate members.



<h2 class="wp-block-heading" id="h-stronger-and-richer">&#8216;STRONGER AND RICHER&#8217;</h2>



Former ICC&nbsp;President&nbsp;Ehsan Mani said there was a lack of vision at the governing body in its approach to developing cricketing nations, despite the huge commercial potential of some of them.



&#8220;One of the biggest risks for global cricket is its over-dependence on one country, India, for a major part of the revenues generated,&#8221; the former Pakistan Cricket Board chairman told Reuters.



&#8220;Countries like the USA and the Middle East and, in longer term, China would bring enormous benefits to the ICC, its members and the global game. World cricket would be stronger and richer for it.&#8221;



For Mani, India grabbing the lion&#8217;s share of ICC revenues &#8220;makes no sense&#8221; and he advocated equal shares for all full members.



&#8220;World cricket needs a strong West Indies, South Africa, Sri Lanka, Bangladesh and Pakistan,&#8221; he added.



&#8220;Cricket in Zimbabwe has suffered due to lack of funds as have Ireland and Afghanistan. Lack of investment in some of these countries will make the game unsustainable and world cricket will be poorer for it.&#8221;



(Reporting by Amlan Chakraborty in New Delhi; editing by Nick Mulvenney and Peter Rutherford)

FILE PHOTO: ICC revenue model threatens growth of game, say associate members

ICC revenue model threatens growth of game, say associate members

Focus On: AfDB Annual Meetings 2023: Financing Africa’s Green Growth

<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="820" height="537" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/05/ED2ISXUD55O23CCWO4CVDP66MU-820x537.jpg" alt="" class="wp-image-425141" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/05/ED2ISXUD55O23CCWO4CVDP66MU-820x537.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/ED2ISXUD55O23CCWO4CVDP66MU-300x197.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/ED2ISXUD55O23CCWO4CVDP66MU-137x90.jpg 137w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/ED2ISXUD55O23CCWO4CVDP66MU-768x503.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/ED2ISXUD55O23CCWO4CVDP66MU-1536x1006.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/ED2ISXUD55O23CCWO4CVDP66MU-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: Uganda&#8217;s President Yoweri Museveni speaks during a Reuters interview at his farm in Kisozi settlement of Gomba district, in the Central Region of Uganda, January 16, 2022. REUTERS/Abubaker Lubowa/File Photo</figcaption></figure>



May 29 (Reuters) &#8211; Uganda&#8217;s tough new anti-LGBTQ law, which stipulates the death penalty for &#8220;serial offenders&#8221;, presents a conundrum for multi-nationals wanting to grow in Africa while promoting diversity and inclusion.



A coalition of companies that includes Google&nbsp;GOOGL.O&nbsp;and Microsoft&nbsp;MSFT.O&nbsp;said it was &#8220;deeply disappointed&#8221; by the bill signed into law on Monday.



Here are some global firms that have substantial operations in Uganda and their strategies for LGBTQ inclusion.



<h2 class="wp-block-heading" id="h-totalenergies">TOTALENERGIES</h2>



TotalEnergies (TTEF.PA) is the leading retailer in Uganda, according to the company&#8217;s website. It is also active in oil and gas exploration and production in the country.



The company has more than 300 employees in Uganda and around 200 service stations.



On its website, TotalEnergies says it is committed to &#8220;promoting equal treatment of employees and an inclusive culture.&#8221;



<h2 class="wp-block-heading">STANDARD CHARTERED</h2>



Standard Chartered&nbsp;STAN.L&nbsp;is the longest-established commercial bank in Uganda, according to its website. It has more than 350 staff in the country and three branches.



On its website, Standard Chartered says &#8220;we go out of our way to ensure that our approach to diversity is mirrored by our suppliers and the communities we operate in.&#8221;



<h2 class="wp-block-heading">GOOGLE</h2>



Google, owned by Alphabet&nbsp;GOOGL.O, launched its first wi-fi network in Uganda in 2015 in the capital, Kampala.



On its website, the company says &#8220;supporting LGBTQ+ communities has been a priority from the earliest days of Google.&#8221;



<h2 class="wp-block-heading">EY</h2>



EY offers services in Uganda including tax and advisory.



On its website, EY says &#8220;LGBT+ inclusion allows companies to attract and retain the best talent and drive high performance teaming through diversity of thought.&#8221;



<h2 class="wp-block-heading">PWC</h2>



PWC offers a range of services in Uganda including tax and advisory. On its website, the company says it supports &#8220;a workplace where lesbian, gay, bisexual, transgender and other (LGBT+) solvers can bring their best selves to work and feel the full support of their PwC family.&#8221;



<h2 class="wp-block-heading">Unilever</h2>



Unilever&nbsp;ULVR.L&nbsp;sells vaseline and other body care products in Uganda. The company looks to &#8220;promote and protect a fully inclusive workplace&#8221; through its &#8216;proUd&#8217; employee network.



The company&#8217;s website quotes an unnamed African employee as saying the network had provided &#8220;comfort&#8221; while they felt like an &#8220;outcast&#8221; in their home country.



(Reporting by Matt Scuffham; Editing by Giles Elgood)

FILE PHOTO: Uganda’s President Yoweri Museveni wants trade barriers to come down, in Kisozi

Global firms in Uganda face LGBTQ conundrum

<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/05/XWKI2BKQCRIARPZUPJLEWZYQLY-1-820x547.jpg" alt="" class="wp-image-425137" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/05/XWKI2BKQCRIARPZUPJLEWZYQLY-1-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/XWKI2BKQCRIARPZUPJLEWZYQLY-1-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/XWKI2BKQCRIARPZUPJLEWZYQLY-1-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/XWKI2BKQCRIARPZUPJLEWZYQLY-1-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/XWKI2BKQCRIARPZUPJLEWZYQLY-1-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/XWKI2BKQCRIARPZUPJLEWZYQLY-1-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: U.S. Secretary of State Antony Blinken testifies during a Senate hearing on Capitol Hill in Washington, D.C., U.S., May 16, 2023. REUTERS/Elizabeth Frantz/File Photo</figcaption></figure>



WASHINGTON, May 29 (Reuters)&nbsp;&#8211;&nbsp;U.S. Secretary of State Antony Blinken on Monday said his government would consider visa restrictions against Ugandan officials and others for the abuse of human rights following the implementation of one of the world&#8217;s toughest anti-gay laws.



Blinken said he has instructed the State Department to update travel guidance to U.S. citizens and businesses over travel to Uganda.



The measures follow President Joe Biden&#8217;s condemnation of the Ugandan legislation.



Biden said the United States may impose sanctions and would evaluate the implications of the law &#8220;on all aspects of U.S. engagement with Uganda.&#8221;



Ugandan President Yoweri Museveni on Monday signed the anti-LGBTQ laws, which includes the death penalty for &#8220;aggravated homosexuality,&#8221; drawing Western condemnation and raising the risk of sanctions by aid donors.



&#8220;This shameful act is the latest development in an alarming trend of human rights abuses and corruption in Uganda,&#8221; Biden said in a statement.



He said he had directed the White House National Security Council to evaluate the implications of the law on all aspects of U.S. engagement with Uganda, including the ability to safely deliver services under the Emergency Plan for AIDS Relief and other forms of assistance and investment.



Biden said the U.S. government would consider the impact of the law as part of its review of Uganda’s eligibility for the African Growth and Opportunity Act, which provides duty-free access to goods of designated sub-Saharan African countries.



&#8220;And we are considering additional steps, including the application of sanctions and restriction of entry into the United States against anyone involved in serious human rights abuses or corruption,&#8221; said Biden.



Same-sex relations were already illegal in Uganda, as in more than 30 African countries but the new law goes further.



(Reporting By Steve Holland; additional reporting by Jasper Ward in Washington; Editing by Leslie Adler, Robert Birsel)

FILE PHOTO: Senate Appropriations Committee hearing in Washington

Blinken says US to consider visa restrictions over Ugandan anti-gay law

<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="820" height="577" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/05/107099617-16597042182022-08-05t125602z_730858418_rc2cqv9tfc59_rtrmadp_0_ukraine-crisis-turkey-russia-820x577.jpeg" alt="" class="wp-image-425131" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/05/107099617-16597042182022-08-05t125602z_730858418_rc2cqv9tfc59_rtrmadp_0_ukraine-crisis-turkey-russia-820x577.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/107099617-16597042182022-08-05t125602z_730858418_rc2cqv9tfc59_rtrmadp_0_ukraine-crisis-turkey-russia-300x211.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/107099617-16597042182022-08-05t125602z_730858418_rc2cqv9tfc59_rtrmadp_0_ukraine-crisis-turkey-russia-128x90.jpeg 128w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/107099617-16597042182022-08-05t125602z_730858418_rc2cqv9tfc59_rtrmadp_0_ukraine-crisis-turkey-russia-768x540.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/107099617-16597042182022-08-05t125602z_730858418_rc2cqv9tfc59_rtrmadp_0_ukraine-crisis-turkey-russia-1536x1081.jpeg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/107099617-16597042182022-08-05t125602z_730858418_rc2cqv9tfc59_rtrmadp_0_ukraine-crisis-turkey-russia-scaled.jpeg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Turkish President Tayyip Erdogan meets with his Russian counterpart Vladimir Putin in Sochi, Russia August 5, 2022. Turkish Presidential Press Office | Reuters</figcaption></figure>



Turkey on Sunday voted for another five years of the leadership of Recep Tayyip Erdogan, the powerful, nationalist president who now enters his third decade in power.



Russian President Vladimir Putin was among the leaders that congratulated Erdogan on his win on Monday, calling him a “dear friend,” according to the Kremlin.



Turkey’s historical election is highly consequential for its population of 85 million, in terms of the future of the country’s democracy, economy and foreign relations. But it’s also deeply significant for many parts of the world beyond Turkey’s borders.



“Turkey is a vital, vital NATO ally for the United States and for the other NATO partners,” David Satterfield, former U.S. ambassador to Turkey, told CNBC just before the final presidential vote. Turkey has been a member of NATO since 1952, boasts the alliance’s second-largest military after the U.S. and houses 50 American nuclear warheads and a major air base used by NATO forces.



It’s a manufacturing powerhouse at the crossroads of Asia and Europe, as well as an important agricultural exporter for many countries around the world. Turkey also hosts more than 4 million refugees.



More recently, Erdogan’s government is playing a leading diplomatic role between Russia and Ukraine and mediating the crucial Black Sea grain deal, which unlocks vital Ukrainian produce exports blocked by Russia’s full-scale invasion.



Erdogan has also stood in the way of some of the major goals of Turkey’s Western allies, such as aggressively pushing back on Russia for its war in Ukraine, and allowing Sweden into the NATO alliance. Erdogan’s friendly relationship with Putin and refusal to impose sanctions on Russia, as well as his government’s purchase of Russian weapons systems, makes many Western officials uneasy.



Putin, in his congratulatory message Monday, praised Erdogan’s efforts to “conduct an independent foreign policy,” according to his spokespeople.&nbsp;“We highly appreciate your personal contribution to the strengthening of friendly Russian-Turkish relations and mutually beneficial cooperation in various areas,”&nbsp;he said.



With Erdogan at the helm of such a strategically vital country for a fresh new presidential term, many are asking: what does this mean for NATO and Western geopolitical goals?



<h2 class="wp-block-heading" id="h-a-threat-to-nato-cohesion"><a></a>A threat to NATO cohesion?</h2>



The outlook is mixed among political and economic analysts inside and outside of Turkey whether Erdogan is bad news for the future of NATO.



Mike Harris,&nbsp;founder of advisory firm Cribstone Strategic Macro, believes the Turkish strongman’s extended rule is decidedly negative for the 74-year-old alliance.



“Putin clearly wants NATO to fragment, and Erdogan in charge increases the likelihood of NATO fragmenting,” Harris said after the election’s first round in mid-May. He pointed to Erdogan’s staunch refusal to cut ties with Putin and to his frequent criticism of Western governments.



But Turkey has so far benefitted significantly from its commitment to an independent foreign policy, when it comes to Russia.



Turkey’s trade with Russia doubled to $68.19 billion in 2022 from $34.73 billion in 2021, according to the Turkish Statistical Institute. Turkey now receives 7% of Russian exports, up from 2% in 2021. Russian tourists and expatriates, including billionaire oligarchs escaping sanctions, have poured into the country as their options for travel became severely limited. Earlier in 2023, Putin waived the cost of Russian gas exports to Turkey, a move broadly seen as an effort to help Erdogan’s election chances.



This begs the question of what leverage NATO allies might try to use to change that, if any.



While maintaining good relations with Russia, Turkey has simultaneously supported Ukraine with weapons and aid — including the powerful and deadly Turkish-made Bayraktar drones — and facilitated prisoner swaps between the warring countries, which Western officials have praised.



<h2 class="wp-block-heading"><a></a>Will Turkey allow Sweden into NATO?</h2>



Many analysts expect that Erdogan’s opposition to Sweden joining the alliance was largely a strategy to gain pre-election clout and that his stance will change following his victory. Turkey takes issue with Sweden over what it says is the country’s support of Kurdish groups that Ankara considers to be terrorists.



For Timothy Ash, an emerging markets strategist and Turkey expert at BlueBay Asset Management, a continued pushback against NATO goes against Turkey’s best interests.



“If Erdogan continues to stall sign off (on Swedish NATO membership), I expect a major crisis in relations with the West,” he said Monday.



“Because of pressure on the lira I expect Erdogan to compromise on Sweden’s NATO bid,” Ash said, referring to the Turkish currency that’s lost some 80% of its value against the dollar in the last five years, largely due to unorthodox monetary policies directed by Erdogan.



“He extracted whatever political capital he could from this (Sweden pushback) pre-election, now he has won there is only downside by delaying the inevitable,” he added. “So I expect Sweden to get NATO membership at the NATO summit next month.”



Harris agrees. “He’s already achieved his objective,” he said of Erdogan. “So is Sweden going to get into NATO? I would put money on that, guaranteed. Why would he fight that battle anymore? That was an election issue.”



Already, Sweden’s foreign ministry on Monday said the Swedish and Turkish foreign ministers will meet “soon” to discuss Stockholm’s potential accession to NATO, according to Reuters.



CNBC has contacted the Turkish presidency’s office for comment.



<h2 class="wp-block-heading"><a></a>Russia relationship ‘vital’</h2>



Ultimately, Erdogan’s foreign policy decisions will be made with the intent to primarily benefit Turkey, not its Western allies. In the words of former U.S. ambassador to Turkey David Satterfield, Ankara’s relationship with Russia is “vital” — whether positive for NATO or not.



“Turkey has been a critical partner for the NATO alliance and for the broader international coalition opposing Putin’s war in Ukraine &#8230; I think ‘supporting Russia’ is not the term I would use,” Satterfield told CNBC’s Dan Murphy on Friday. “Turkey has a vital relationship with Russia, its relationship that has generated both good and bad for Turkey in the past,” he said.



“We welcome, welcome the dialogue that President Erdogan has with President Putin, when the subject is stabilization, when the subject is the ability to access grain and other products through the Black Sea from Ukraine, that has been extremely useful and extremely important,” the ambassador said.



“And we do not see this as a pivot or an alignment of some kind with Russia. We see it as the conduct of necessary relations with a very important, for good or ill, neighbor of Turkey.”

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home

Nigeria to triple petrol prices after president says subsidy to end

UBA: Bond market mixed despite elevated liquidity

S&P sees weaker 2023 growth in key African economies as tailwinds fade

Nigeria Eurobonds & stocks rally on new policy direction

Making Hay Under The African Sun

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Nigerian equities sustain rally

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Focus On: AfDB Annual Meetings 2023: Financing Africa’s Green Growth

Global firms in Uganda face LGBTQ conundrum

Blinken says US to consider visa restrictions over Ugandan anti-gay law

Putin congratulates ‘dear friend’ Erdogan as NATO’s Turkey challenge looks set to stay

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